Opec’s challenge - to pump more oil while keeping deal in place

U.S. crude oil production was flat week-on-week, remaining at a record 10.9 million bpd.

Saudi Energy Minister Khalid Al-Falih said Thursday that OPEC members and other countries who agreed in November 2016 to cut output should increase supply by about one million barrels per day to prevent a shortage. The market is now under "OPEC-Watch" with numerous major players on the sidelines until the cartel along with Russian Federation makes its decision about production rates at its meeting in Vienna on June 22-23.

Saudi Arabia, backed by non-member Russian Federation, is now racing to convince the alliance to raise production again in order to meet growing demand in the second half of 2018. The proposal has yet to win the backing of all OPEC members, and may meet resistance from more hawkish countries in the group including Venezuela and Algeria as well as Iran.

"It would seem that an aggregate increase in production for OPEC+ of between 500,000 barrels per day (bpd) and 1 million bpd is the range that is being considered", Tchilinguirian said.

Most of the shortfall has come from Venezuela, where an economic crisis has savaged the nation's petroleum production.

Prices of Brent Crude were down to $73.34 on Thursday, after highs earlier this month of around $80, while U.S. light crude CLc1 dropped $1 to $64.71.

Also supporting prices was a drop in Libyan supplies due to the collapse of an estimated 400,000-barrel storage tank.

"Globally, crude prices have gone beyond the threshold, which can be sustained by the world, particularly countries like India, which is a key driver of world economy", Mr. Pradhan said at an OPEC conference in Vienna.

OPEC takes its decisions by unanimity, so if Iran were to wield its veto Saudi Arabia would be left only with the option of assembling a coalition of willing countries to bypass Tehran's opposition.